Osborne: Real Progress On Eurozone Crisis

George Osborne has said "real progress" was made during eurozone talks in Brussels - as David Cameron prepares to discuss the crisis with other leaders.

The Chancellor said "important decisions" were taken during marathon talks in Brussels, which lasted 10 hours.

"Provisional" agreement has been reached on the recapitalisation of banks to the tune of almost 100bn euros (£87bn).

This is conditional on a complex and much wider EU deal being forged in the next few days.

Other elements to be agreed include a huge increase in the eurozone bailout fund and a planned 50-60% write-down of Greek debt.

Mr Osborne said: "It was very important today that Europe took decisions.

"After ten hours of talks we have made real progress and we have come up with important decisions to strengthen European banks."

He added: "Britain will keep up pressure in the next few days to a comprehensive package to resolve the European crisis and to make sure that we get jobs and growth."

German chancellor Angela Merkel was also positive after the talks, saying: "We have to take far-reaching decisions. These have to be prepared properly.

"I believe that the finance ministers made progress, so that we can achieve our ambitious targets by Wednesday."

Sky News' economics editor Ed Conway, who is in Brussels, said the talks on Saturday nearly broke down at one stage.

It was only the intervention of finance ministers from Britain, France and Germany that steered them back on track.

The meeting precedes a summit on Sunday of all 27 EU leaders, which will be attended by David Cameron.

On the table is a massive increase to the existing 440bn euro (£383bn) bailout fund, possibly four-fold to two trillion euros (£1.74tn).

But more progress depends on resolving major disputes over details between Ms Merkel and French President Nicolas Sarkozy.

They were having dinner in Brussels to thrash out concerns about the size of the bailout fund and how much of a "discount" to give Greece on its debts.

It was supposed to be a dinner for two - but in the end they were joined by International Monetary Fund chief Christine Lagarde, outgoing European Central Bank boss Jean-Claude Trichet, European Commission President Jose Manuel Barroso and EU Council President Herman Van Rompuy.

A eurozone summit had been planned for last Monday but it was delayed when Ms Merkel and Mr Sarkozy realised they were at odds.

The sense of confusion has deepened since Paris and Berlin announced that another summit would be held in Brussels next Wednesday - indicating no results are likely from the Sunday meeting.